When it comes to doing taxes, it’s important to know your programs! Every single state offers programs for individuals with disabilities. This might actually help reduce your tax bill for the current year.
The Benefits of ABLE Accounts
An ABLE account is a tax advantage savings account for individuals with disabilities and their families. I made recommendations to several individuals about looking into ABLE accounts. I personally do not qualify for this account, but if you do, it’s a great tool.
The Benefits of a Roth IRA
Another great account that you can open to help with savings when you have a disability is a Roth IRA. This type of account is probably my favorite. A Roth IRA is another tax advantage savings account. You do not need to have a disability or meet qualifications to open this account. The amount of money per year that you can contribute to a Roth IRA does change every year. Currently, the contribution limit is $6,000 a year per individual, unless you’re over the age of 50.
If you are over the age of 50 you can deposit $7,000 a year into the account. There are also no minimum required contributions unless you want to. A Roth IRA can be open at any major bank that has a securities division. If you bank with a local credit union, I would check with your bank manager to see if they have a securities division to open a Roth IRA.
Use a Professional Account
Hire a professional accountant to do your taxes. I know that we’re in the 21st-century and most people use TurboTax or file their taxes themselves. There isn’t really much of a cost difference between filing your taxes with TurboTax and hiring an accountant. If you are a sole or joint filer and do not have own business, a program like TurboTax might actually benefit you, especially if your taxes are pretty straightforward.
Disabilities Can Determine Your Tax Burden
Having a disability can complicate things or put extra strain on you financially. I know in previous blogs I’ve talked about making sure that you have enough in savings, to make a budget every month and every year, and plan for a rainy day or a big medical expense.
Personally, I’ve had an accountant since I started collecting a paycheck at the age of 17. With my disability, my finances change frequently. Some years, I spend more on medical care and other years I spend more on repairs. Sometimes, depending on the tax code, my accountant was able to lessen my tax burden because of a credit that was offered because of my disability. These are little things that TurboTax cannot offer you.
About Josh McDermott: Josh is a brand ambassador for Quantum Rehab®. He is a public speaker and has served as a goodwill ambassador for the Muscular Dystrophy Association. Josh lives in New York and loves to travel. Click here to learn more about Josh.
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